By Vicente Morin Aguado
HAVANA TIMES – After a year-long absence, many Havana shopping centers are selling flat screen TVs again. Before, the most sought-after model (32-inches) had run out or under the dust of existing models, cost so much that it encouraged people to personally import them in bulk from neighboring countries.
The Carlos III shopping center in Havana is selling 32-inch LED screen RCA TVs, manufactured by a Chinese company, at the “reduced” price of 299.95 convertible pesos (CUC) per unit. The new load for sale is almost 200 CUC cheaper than similar models which were sold for 498.95 CUC (= to USD) on the national market, in a country where the average wage is around 25 CUC per month.
Readers who are unaware of the details of Cuba’s buying and selling system, would say two things: 1) What a discount! 2) If you look at the figures, this market seems to work really well, right?
Both of these conclusions are wrong. For example, in Miami, if a leading brand, Samsung, were to send a TV with the same specifications, in addition to a USB port and a set-top box for digital TV reception (both of these services aren’t offered with the above-mentioned RCAs), it would cost 170-200 USD, cash, depending on where you bought it.
And in reference to the second point, well, there’s nothing further from the truth than prices in Cuba. These are directly set by bureaucrats at the Ministry of Finances and Prices and fractions serve as a way to give a fuller and more competent image to the national market when the reality is that prices are set outside of supply and demand.
Retired IMF economist, Joaquin Pujol warns the following:
“It’s crazy to have to go and buy in Haiti or Guyana what you could perfectly buy in your own country, because you can’t import it directly, you have to do this by traveling as a tourist, which greatly increases the costs of these imports.”
It’s true, brands which are the same as China’s RCA (for example, Toshiba) can be bought outside of Cuba for approximately 120 USD. If there was a wholesale importer, this would clearly cost a lot less. Why are they then selling TVs for three times their worth at stores in Havana?
The monopoly state enforces its advantages above caring about the working population’s sacrifices, which is who they say they represent. A simple analysis would reveal:
- Transport to Cuba plus Customs tax, double the price. And add to that, airport tax in Havana which can only be paid in Cuban pesos (CUP) once a year. (10 CUP per 32-inch LED TV).
- There are additional tourist expenses, which are hard to calculate but are felt nonetheless, including Visas, passports, airplane tickets, accommodation in the other country, etc.
- Selling the TV on in our country has no commercial warranty and even though there are many complaints made by customers about state store sales, there is at least a warranty.
The economist reminds us: “They use inefficient state-run companies, why the State? Private importers would be better who could then adjust prices to competitive rates.”
You’re dreaming Mr. Pujol, as well as many others here, because the State will never give up this absolute power they have over society which allows them to control the national market.
Even so, you don’t see lines where TVs are being sold in Carlos III, where many things are sold in hard currency. Some passers-by and a cash buyer happened to chip in their thoughts:
These are old devices, you don’t see those RCAs outside of Cuba anymore. Who knows if they are any good!
Three hundred are three hundred (CUC, equivalent to the USD). If you have somebody who travels in the family, better to ask them to get you one from another country.
Not everyone has that somebody in their family,” the man paying for his new flat screen TV interrupts, “that’s why I’m buying it here, and if it doesn’t work properly, they’re going to have to change it for me or fix it.
But, because it doesn’t come with a set-top box, you have to pay another 50 CUC for it in order to watch digital TV, which means it costs nearly 350 CUC.
If this stock doesn’t run out right now (which is something that happens quite frequently in the Cuban monopoly’s retail network), private importers will have to hang in there, because a Samsung is being sold in Havana for approximately 400 CUC. However, this brand’s reputation paired with the poor service in the state market, work in private vendors favor.
The majority of our fellow countrymen are receiving a new lesson, people who hold onto eternal hope, but are now being trapped with the wizardry of the New Constitution in the making. Ink will stick to paper.
Vicente Morin Aguado: [email protected]